2013 (7) TMI 1091 - HC - Income Tax

High Court upholds Tribunal's decision on unexplained investment & estimated profit, dismisses appeal based on stock statement discrepancies.

The High Court of Andhra Pradesh dismissed the appeal challenging the Tribunal's decision on the addition of unexplained investment and estimated profit ... - Issues involved: Appeal against Tribunal's decision on addition of unexplained investment and estimated profit based on stock statement discrepancies.The appeal raised three questions of law regarding the Tribunal's decision on the addition of unexplained investment and estimated profit based on stock statement variances. The Tribunal had deleted the addition of Rs. 1,19,43,361 for unexplained investment and Rs. 5,89,677 for estimated profit on unaccounted sales. The main contention was whether the Tribunal's findings were justified in light of the discrepancies between the stock statement submitted to the bank and the stock recorded in the books of account. The assessee explained that the bank statement was based on estimates, while the account presented for assessment was based on actual physical verification. The Court cited various precedents to support the principle that differences between bank statements and account books do not warrant additions if physical verification does not reveal discrepancies. The appeal was dismissed, affirming the Tribunal's decision and citing the settled legal position on the issue. Judgment Summary:The High Court of Andhra Pradesh dismissed the appeal challenging the Tribunal's decision on the addition of unexplained investment and estimated profit based on discrepancies in stock statements. The Court upheld the principle that differences between bank statements and account books do not justify additions if physical verification does not reveal discrepancies. The appeal was deemed unnecessary as the issue was settled by previous decisions, leading to the dismissal of the appeal without costs.